Indonesian Stock Market Declines Amid Global Tensions: IHSG Falls Below 6,000

The Jakarta Composite Index (IHSG) closed at 5,925.98 on October 13, 2026, marking a decline of 0.17% from the previous day. This follows a more significant drop of 2.59% on October 12, when the index fell to 5,936.14, the lowest level in three months. Investor sentiment has been heavily influenced by escalating geopolitical tensions, particularly the recent attacks by Houthi forces on Saudi Arabia, which have raised concerns about global oil supply disruptions.

On October 12, the IHSG opened at 6,109.31 and reached a high of 6,128.72 before declining sharply. The trading volume was substantial, with 62.18 billion shares changing hands and a turnover of approximately Rp 13.73 trillion (around $900 million). The market saw 602 stocks decline, while only 114 gained, reflecting a broad-based sell-off.

According to analysts at BRI Danareksa Sekuritas, the decline in the IHSG was largely due to investor caution amid global uncertainties. They noted that the geopolitical situation, particularly the Houthi attacks, has increased the risk of U.S. involvement in the Middle East, which could lead to volatility in oil prices and heightened risk aversion among investors. BRI Danareksa Sekuritas analysts said that geopolitics is heating up with the Houthi attacks on Riyadh increasing the risk of U.S. involvement and escalation of the Middle East conflict, which can drive oil price volatility and increase investor risk aversion.

“BRI Danareksa Sekuritas analysts said that geopolitics is heating up with the Houthi attacks on Riyadh increasing the risk of U.S. involvement and escalation of the Middle East conflict, which can drive oil price volatility and increase investor risk aversion.”BRI Danareksa Sekuritas, analysts

Additionally, the market is awaiting crucial inflation data from the United States, which will influence the Federal Reserve's interest rate policy. A high Consumer Price Index (CPI) could maintain tight monetary policies, supporting the U.S. dollar and pressuring emerging market assets, including Indonesia's stock market.

In the context of regional markets, Asian indices displayed mixed results, with Japan's Nikkei down 1.93% and Hong Kong's Hang Seng slightly lower by 0.02%. Meanwhile, the Shanghai Composite was reported to have declined by 0.43% according to some sources.

Despite the overall decline, foreign investors were noted to engage in net buying of Rp 561.60 billion ($37 million) across the market on October 13, according to some reports, although other data indicated net selling activity. This suggests mixed data or different session timings. Analysts suggest that while the IHSG has faced significant downward pressure, certain sectors and stocks are still attracting foreign interest.